2 Revised 2021
I. Breach of Contract
In North Carolina, claims on a construction project primarily involve claims for breach of
contract. In order to properly plead a claim for breach of contract, the complainant should allege:
1) the existence of a contract, 2) the specific provisions breached, 3) the facts and circumstances
constituting the breach, and 4) the amount of resulting damages. Cantrell v. Woodhill Enterprises,
Inc., 273 N.C. 490, 160 S.E.2d 476 (1968). “[W]here the cause of action is a failure to construct in
a workmanlike manner and with the material contracted for, plaintiff's pleading should allege
wherein the workmanship was faulty or the material furnished by defendant was not such as the
contract required.” Id. at 497, 160 S.E.2d at 481. A party may also breach the contract by
repudiation. A party repudiates a contract when, by his words or conduct, he expresses an
unequivocal and absolute refusal or inability to perform. Messer v. Laurel Hill Assoc., 93 N.C.
App. 439, 378 S.E.2d 220 (1989); Profile Invs. No. 25, LLC v. Ammons East Corp., 207 N.C. App.
232, 700 S.E.2d 232 (2010). A lien granted pursuant to Chapter 44A of the General Statutes
cannot be premised on a contract implied in law. Waters Edge Builders, LLC v. Longa, 214 N.C.
App. 350, 715 S.E.2d 193 (2011).
II. Negligence
Negligence is the failure to exercise the appropriate standard of care under the given
circumstances, whether that standard be imposed by statute or common law. In North Carolina,
in order to establish a claim for negligence, a party must prove: 1) a duty imposed by law to
conform to a certain standard of care; 2) a failure to conform to that standard; 3) a causal nexus
between the failure to conform to the standard and the resulting injury or damage; and 4) actual
damages or injury. Sasser v. Beck, 65 N.C. App. 170, 308 S.E.2d 722 (1983).
Violations of the North Carolina Building Code constitute negligence per se. Oates v. JAG,
Inc., 314 N.C. 276, 333 S.E.2d 222 (1985).
While North Carolina does recognize a claim for negligent construction, it should be noted
that North Carolina has also long held that "[o]rdinarily, a breach of contract does not give rise
to a tort action by the promisee against the promisor." N.C. State Ports Authority v. Lloyd A. Fry
Roofing Co., 294 N.C. 73, 81 (1978); see, e.g. Supplee v. Miller-Motte Bus. College, Inc., 239 N.C.
App. 208, 768 S.E.2d 582 (2015); see e.g. Hardin v. York Mem'l Park, 221 N.C. App. 317, 730 S.E.2d
768 (2012). Commonly known as the economic loss rule, the law is well-settled in North Carolina
that there is no recovery in tort for purely economic losses. Similarly, “[A] tort action does not
lie against a party to a contract who simply fails to properly perform the terms of the contract,
even if that failure to properly perform was due to the negligent or intentional conduct of that
party, when the injury resulting from the breach is damage to the subject matter of the contract.
It is the law of contract and not the law of negligence which defines the obligations and remedies
of the parties in such a situation.” Kaleel Builders, Inc. v. Ashby, 161 N.C. App. 34, 43, 587 S.E.2d
470 (2003). The owner of a general contracting company may be held personally liable for
negligent construction of a building if the owner personally supervised or performed the
construction. White v. Collins Bldg., Inc., 209 N.C. App. 48, 704 S.E.2d 307 (2011).